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Pope Francis has given the Vatican secretariat of state three months to transfer all of its financial holdings to another Vatican office following its bungled management of hundreds of millions of euros in donations and investments that are now the subject of a corruption investigation.
Francis summoned the secretary of state, Cardinal Pietro Parolin, his deputy, as well as the Vatican’s top finance officials for a meeting on Wednesday and gave them a three-month deadline to complete the transfer, Vatican spokesman Matteo Bruni said.
The Vatican released the letter that Francis wrote to Parolin on August 25 in which he announced he was stripping the secretariat of state of its ability to independently manage the money.
Francis cited the “reputational risks” incurred by the department’s previous investments in speculative operations that have cost the Holy See tens of millions of euros, some of it from Peter’s Pence donations from the faithful.
Francis’s decision was an embarrassing blow to the secretariat of state’s standing as the most powerful Holy See office, reducing it to essentially any other department that must propose a budget and have it approved and monitored by others.
Its financial holdings are now to be held by the Vatican’s treasury office, known as APSA and incorporated into the Holy See’s consolidated budget, Francis wrote. The economy ministry will oversee spending.
The outcome is essentially that which was sought years ago by Cardinal George Pell, Francis’s first economy minister who clashed with the secretariat of the state over his financial reforms and efforts to wrest control of the department’s off-the-books funds. He famously boasted in 2014 that he had “discovered” hundreds of millions of euros that were “tucked away in particular sectional accounts and did not appear on the balance sheet” – a reference to the secretariat of state’s in-house asset portfolio.
Pell had to abandon those reform efforts in 2017 to face trial for sexual abuse in his native Australia, but he was acquitted and returned triumphantly last month to Rome, where he was granted a well-publicised audience with Francis.
Francis moved against his own secretariat of state amid a yearlong investigation by Vatican prosecutors into the office’s 350 million euros ($413m) investment into a London real estate venture.
Prosecutors have accused several officials in the department of abusing their authority for their involvement in the deal, as well several Italian middlemen of allegedly fleecing the Vatican of tens of millions of euros in fees.
The scandal has exposed the incompetence of the Vatican’s monsignors in managing money since they signed away voting shares in the deal and agreed to pay exorbitant fees needlessly to Italians who were known in business circles for their shady dealings.
In his letter to Parolin, Francis cited the London venture as well as the secretariat of state’s investment in a Malta-based investment vehicle, Centurion Global Fund, headed by the Vatican’s longtime external money manager.
According to Italian daily Corriere della Sera, Centurion invested in such ventures as the “Rocketman” film on Elton John as well as a holding company headed by Lapo Elkann, one of the more flamboyant members of Italy’s Agnelli clan.